The Australian Dollar broke upward against its US namesake as expected, completing a Falling Wedge chart formation. A daily close above the 38.2% Fibonacci expansion at 0.9351 exposes the 50% level at 0.9386. Alternatively, a turn below the 23.6% Fib at 0.9308 opens the door for a challenge of the 14.6% level at 0.9282.

We will tactically opt to stand aside for now. While entering long is tempting from a technical perspective, topping clues in the S&P 500 warn of oncoming risk aversion and argue against buying the sentiment-sensitive Australian unit. Indeed, the correlation between the benchmark stock index and AUD/USD is now 0.80 (on rolling 20-day studies). With that in mind, we will continue to stand aside.